Ken Silverstein EnergyBiz Insider Editor-in-Chief

Without a doubt, the free enterprise system is designed to fill voids in the market. So, if job shortages exist, then businesses and schools join hands to meet that need. The central issue at utilities is that the attrition rate has exceeded the rate at which people are getting educated and coming into the ranks -- all compounded by the fact that some schools have discontinued their programs to educate students for a lifetime in the utility sector.

"Utilities are part of a nuts and bolts industry that is vital to our way of life," says Don Hurd, CEO of Englewood, Co.-based E3 Consulting. "But this is not attractive to young college students. This is a looming problem, not an immediate one. We are in the right time frame to try and catch it. We now have an opportunity -- to show young people that they can have an exciting career in the energy sector."

According to U.S. Department of Labor, by 2012 there will be about 10,000 more power jobs available than people willing to fill them. The average age at utilities is about 48. The matter is compounded because younger people view utilities as part of the industrial age and less thriving than other technical fields such as nanotechnology. People will be needed to fill everything from engineering jobs to those in environmental sciences and in the field servicing customers and stringing wire from pole to pole.

Some utilities are doing something about the expected labor shortage now. Xcel Energy in Minneapolis has some in-house initiatives to develop educational programs for mid-level managers, linemen and power plant workers. Avista Corp., meanwhile, has a 40-hour a week school for linemen. The school requires an upfront investment in tuition and supplies but its graduates can earn as much as $20 an hour.

At the same time, universities in Minnesota are adding courses focusing on utility management and engineering. Ditto for the University of Colorado, which is now trying to ramp up a program to give students a complete overview of the utility. That is, it is bringing courses to the forefront to teach students about construction, regulations, reliability and generation.

"With renewables and conservation becoming more viable, we can attract more students," says Frank Barnes, an engineering professor at the University of Colorado. "There is new opportunity in this sector but utilities have yet to capitalize on it."

Hiring and recruiting is supposed to be a function of a well-thought out strategy and not one that is the result of a crisis, experts say. It's particularly applicable for an industry that provides a vital service such as the production and delivery of electricity. The goal now is to develop a pool of qualified job applicants and one that can sustain the industry.

Big Changes

When deregulation of the energy sector surfaced in the 1990s, utilities didn't know what it would be like to compete. A lot of talent was pushed out while pros from other industries were brought in. The central task had been to move away from a regulatory mindset and toward a way of thinking that tried to maximize returns. Many professionals subsequently came from marketing and finance departments at other endeavors and were taught to integrate their knowledge into the utility structure.

But, technically-oriented positions have been forsaken, or ones focused on engineering and regulatory management. As a result, utilities have lost many of those assets to other industries and all at a time when fewer people are studying electric power and combustion engineering as well as fossil power plant design.

Utility executives have therefore begun to increasingly turn inward with an understanding that existing employees are not only more loyal but also cheaper to maintain and to train than many outsiders. Human resource executives say that after companies have filled key positions, they must find opinion leaders, preferably within the company. Those individuals are likely to adapt to changes implemented by the division heads and to encourage co-workers to acclimate as well.

Utility professionals were once considered to have lifetime jobs. That's no longer possible, given new competitive pressures along with more consolidation that has been the cause of mass lay-offs. But, in the old days, a "more natural transfer of knowledge" took place, says John Ferrare, partner at Enerdynamics in San Francisco, which trains professionals for the electric and gas industry. Now, the loyalties are not there, he adds.

"You can look at any number of studies and you will find that investing in development is what keeps workers loyal," says Ferrare. "If their companies invest in them, they will feel like they are learning and growing. When a worker understands where they fit into the whole scheme of things that is a positive."

To be sure, the utility marketplace is not stagnant. Workers in all aspects of the industry are encouraged to re-evaluate their job skills and to network across their industries. It's time to re-tool and to begin to discover where the new possibilities lie. For those willing to embrace change and upcoming challenges, they will be more valued throughout the industry, adding to job security.

Toward that end, the potential job shortages will get filled. The real question is how quickly the industry and the supporting academic institutions can ramp up to meet pending needs. Utilities, meantime, are urged to work with their greatest assets: their current workforce. Internal candidates often are stronger because they are rooted to the company in ways that outsiders are not. Workers feel a sense of growth while companies gain a well-rounded workforce that has performed many jobs. It's an initiative that could pay big dividends as tomorrow's leaders will come from today's ranks.

The utility sector has gone through tumultuous change. In the midst of the overall confusion, however, utilities have forsaken their future needs and how they plan to fill that hole. A skills shortage might result. But so might an abundance of new opportunities and particularly ones that will be appealing to existing workers and young people looking for challenges. There's a fork-in-the-road and companies such as Xcel and Avista have chosen to build the platform that will keep their enterprises erect.

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